For starters, skyrocketing revenues have helped tech companies take over of the stock market.

The technology quintet are now the top five most valuable companies in the world. Apple has usurped the top spot from the likes of GE and Exxon Mobile, with a market cap of $861 billion at the end of 2017. Hardware – namely the iPhone – is the biggest source of Apple’s revenue. The Cupertino giant is also sitting on enough cash to buy every franchise of the top five US sports leagues and have $50 billion leftover, according to the report.

Source: Statista Digital Economy Compass 2018

While each of the five tech giants continue to rake in billions, they are all reliant on a core part of their business. For example Facebook and Google’s fortunes are highly dependent on digital advertising.

For Google, its dominance in search advertising means it can pour money into its “Other Bets” business which includes self-driving car project Waymo and AI acquisition Deepmind, which are yet to break even.

Facebook, which now has two billion monthly active users, generates a massive 98 per cent of its revenue from ads. The other 2 per cent comes from payments and other fees.

Furthering its dominance in social, Facebook-owned Instagram now has two million active advertisers and Credit Suisse expects its revenue to reach $9.5 billion in 2021, up from 5.4 billion last year.

Source: Statista Digital Economy Compass 2018

Microsoft — the tech giant everyone forgets about — has the most diverse revenue base of the top five.

Software including Microsoft Office products are the largest revenue source for the Redmond-based company. But Azure, its commercial cloud business, is getting more important, generating 17 per cent of revenue in 2017, up from 1 per cent five years earlier.

Source: Statista Digital Economy Compass 2018

Amazon’s cloud business, Amazon Web Services (AWS), is also growing quickly and makes up 10 per cent of the company’s revenue. But retail still accounts for 83 per cent of the Seattle-company’s earnings.

Within that, Amazon’s retail products contribute 64 per cent of revenue. Memberships and subscriptions like Prime account for 6 per cent and 18 per cent comes from payments, which includes Amazon’s marketplace business. Advertising is around 3 per cent.

The Author

Tess Bennett

Tess Bennett is the editor of Which-50 and is responsible for leading the publication’s daily coverage of Australia's digital businesses for C-Suite executives, strategists, founders and directors. As the former editor of Internet Retailing Australia and journalist for Inside Retail, Tess has five years experience covering retail and ecommerce. At Which-50 Tess reports on a broad range of topics including technology, the industrial internet, analytics and digital marketing.

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